Assuming the tax payer's AGI is below the max limit for using EE Bonds for Education and the interest is exempted from AGI due to being used for Qualified Higher Education Expenses.....does the interest get added into MAGI for determining income for ACA tax subsidy? According to Form 8962 and the Data Source for the form, it does not. This is extremely important for accuracy as this could decrease or eliminate an ACA Tax Subsidy due to a higher MAGI . Thank you for your reply.
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No. The amount for U.S. Savings Bond interest used to pay for qualified education expenses is not included in AGI. TurboTax will do this calculation for you.
Thank you for your reply. I understand the interest is not included in AGI, however, should it be included for MAGI when determining your total income for ACA tax subsidy? Even though the interest is used for Qualified Higher Education Expenses. I cannot find this example anywhere on the IRS site.
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